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Voluntary Retirement is only offer by Employee; revocable before acceptance: Delhi HC

Voluntary Retirement is only offer by Employee; revocable before acceptance: Delhi HC

Delhi High Court in Poonam Garg v IFCI Venture Capital Funds held that an application for voluntary retirement is only an offer by the employee to the employer and the same maybe withdrawn anytime before communication of its acceptance.

Justice Rekha Palli after considering the facts and precedents in the matter, observed, “The question as to when an employee can be allowed to withdraw his request for resignation or voluntary retirement and the employer’s right to reject such request for withdrawal has been considered by the Supreme Court from time to time and the common thread running through all these decisions is that in normal circumstances, an employee can withdraw its resignation before it comes into effect or operation.”

Poonam Garg had requested voluntary retirement after 24 years of service, but decided to withdraw the application within a week of filing it. IFCI Venture Capitals however, informed her that her voluntary retirement was accepted and her withdrawal request was not considered favourably.

Ms. Poonam thus moved the High Court praying that her brother’s hospitalization caused her grave mental and physical stress under which she had applied for voluntary retirement. However, she was soon informed of improvement in his health; so she applied for withdrawal of her request, which was in fact in the best interest of the organization. Three weeks later, she received communication that her retirement request was confirmed.

Paragraph 33(2)(v) of the Regulations of the company clearly stipulates that an employee, who has elected to retire voluntarily, can seek withdrawal of his application for voluntary retirement. Court held: “The respondent-employer cannot be permitted to act in violation of its own Regulations, even if they are not statutory in nature.”

Court held that it was “evident that before the respondents communicated their alleged acceptance of the petitioner’s request for voluntary retirement, she had sought withdrawal thereof. The petitioner’s request for withdrawal, therefore, ought to have been accepted.”

The High Court rejected the Company’s contention, that she being a high-ranking official in the company, had constructive notice of processes taking place in the wake of her application and that the Company’s communication of acceptance of her retirement application was a mere technicality.

Court reiterated the apex court’s position that voluntary retirement is governed by Contractual principles and hence the application is an offer which is deemed accepted on the last working day after serving the notice period. Thus, an employee can withdraw her request anytime before that.

Court thus held: “The respondents are directed to treat the petitioner to have validly withdrawn her request for voluntarily retirement. As the petitioner has continued to be in service even after 07.09.2019, the respondents are directed to grant her all consequential benefits by treating her to be in continuous service.”

–India Legal Bureau